Why Fiat Currency Prevents Bitcoin Confiscation (And Should Therefore Keep Existing)

I have already expressed the opinion here that Fiat is not bad because "politicians are evil" (though many of them certainly are), but because Fiat allows politicians to give their voters what they want, that is, what they have voted for. Voters support endless transfers and "social expenses" of all sorts; of the sort, in fact, that were non-existent at the time of the Gold Florin, just because you could not print Gold Florins. These transfers cost money. Elected politicians finance these expenses with a mixture of straight money printing, deficit-fuelled "quantitative easing" (which is ultimately the same, but sounds more sophisticated) and good old tax increases. You know that it is so by the fact that it is extremely difficult to reduce these transfers, which is a clear sign that they would be political suicide for those who were to promote them. They might target waste and inefficiencies, but they will not target the root cause of the Fiat problem: the fact that such transfers exist. Now let us imagine a world (which is desired by many here) in which BTC has substituted the USD as currency. Basically, we are back to the Gold Florin: something Government cannot manipulate (then: gold; today: Bitcoin) rules the game. The Government cannot print anything. This means that this Government cannot finance deficit by debasing Fiat. What would that happen? Would the voters miraculously accept that a Government is not allowed to run a deficit? Would they stop to demand transfers of all sorts? Would they stop decrying "inequalities"? Hardly. What would happen is that you have a mixture of debt and forced confiscation of Bitcoin. You don't want that. What you want is a Fiat currency that keeps existing and keeps being the way politicians satisfy the wishes of the transfer-angry mob, those who don't know what saving is and have a high time preference. Meanwhile, you prosper because you keep stacking sats that no government will have want to confiscate, because it's so much easier to print money instead. submitted by /u/ManlyAndWise [link] [comments]

Apr 21, 2025 - 15:05

I have already expressed the opinion here that Fiat is not bad because "politicians are evil" (though many of them certainly are), but because Fiat allows politicians to give their voters what they want, that is, what they have voted for.

Voters support endless transfers and "social expenses" of all sorts; of the sort, in fact, that were non-existent at the time of the Gold Florin, just because you could not print Gold Florins.

These transfers cost money. Elected politicians finance these expenses with a mixture of straight money printing, deficit-fuelled "quantitative easing" (which is ultimately the same, but sounds more sophisticated) and good old tax increases.

You know that it is so by the fact that it is extremely difficult to reduce these transfers, which is a clear sign that they would be political suicide for those who were to promote them. They might target waste and inefficiencies, but they will not target the root cause of the Fiat problem: the fact that such transfers exist.

Now let us imagine a world (which is desired by many here) in which BTC has substituted the USD as currency. Basically, we are back to the Gold Florin: something Government cannot manipulate (then: gold; today: Bitcoin) rules the game. The Government cannot print anything. This means that this Government cannot finance deficit by debasing Fiat.

What would that happen? Would the voters miraculously accept that a Government is not allowed to run a deficit? Would they stop to demand transfers of all sorts? Would they stop decrying "inequalities"? Hardly.

What would happen is that you have a mixture of debt and forced confiscation of Bitcoin. You don't want that.

What you want is a Fiat currency that keeps existing and keeps being the way politicians satisfy the wishes of the transfer-angry mob, those who don't know what saving is and have a high time preference.

Meanwhile, you prosper because you keep stacking sats that no government will have want to confiscate, because it's so much easier to print money instead.

submitted by /u/ManlyAndWise
[link] [comments]